Jordan to push IMF for more time on implementing reforms after protests: officials

DUBAI/BEIRUT: Jordan will ask the IMF to give it more time to implement reforms after some of the largest protests in years showed pushing the debt-burdened country beyond its means risked major instability, officials said.

A week of rare protests has brought down the government and forced King Abdullah to effectively suspend tax rises – a key part of fiscal consolidation plans pushed by the IMF to reduce Jordan’s large public debt. The government is unlikely to abandon the IMF program, but officials believe its hasty implementation sparked the protests.

“Jordan cannot afford to abandon the program but will ask to extend its duration for one or two years. Provided you show commitment you are delivering, I think this is doable,” an official involved with the IMF program said.

“Pushing countries to the extreme regardless of the political environment was not the right thing. The IMF now has to take into consideration Jordan’s capacity in what it can do,” said a second senior economic official who requested anonymity.

Omar Razzaz, the designated new prime minister – a Harvard-educated ex-World Bank economist – is expected to address deeper social and political factors that triggered the protests.

Razzaz has long opposed the free-market reforms that the kingdom pursued for nearly three decades.

He is expected to steer away from the enthusiastic embrace of unpopular IMF mandated measures, officials familiar with his thinking said.

“He adopts a more gradualist approach ... and is more attentive to mitigating the impact of reforms on the poor,” said a former Cabinet member who has worked with Razzaz and requested anonymity.

International Monetary Fund officials in the Middle East were not immediately available to comment.

Mohammad Zwahreh, who had been involved in the week’s protests, mirrored this sentiment in comments to The Daily Star.

“I think he is an honest man and will be able to find balanced economic solutions, without being too much of a populist politician,” he said via WhatsApp.

Thousands took part in a half-day strike Wednesday and warned of further action until a new government is formed and the proposed IMF-backed tax hikes scrapped.

Crowds gathered outside the Council of Professional Associations headquarters midafternoon in Amman, yelling anti-government slogans and waving Jordanian flags.

A union spokesperson shouted to the rally that Jordan “will not return to the old ways or to the old government.” Many of the unions did not participate in the day’s strike, with the rally drawing smaller numbers than this week’s protests – the largest the Hashemite Kingdom has seen since 2011.

The doctors’, engineers’, and lawyers’ unions were the main groups taking part in the walkout.

The President of the Doctors Syndicate Ali Abous vowed that they would continue until the proposed laws are withdrawn from Parliament, local media reported.

“The scope of demands from the protestors has expanded quickly; people want to see larger, political reforms and tackling of corruption,” rights advocate Fadi al-Qadi told The Daily Star via WhatsApp, having participated in the day’s strike. “The strikes are not against Omar Razzaz,” said Banan, another protester, who declined to give her full name, “but everything is not OK just because [ex-Prime Minister Hani] Mulki resigned; the country’s problems are much bigger.” She also praised the king for moving things in the right direction.

But when asked if she would join the evening’s protests, she said that, despite having taken part throughout the week, she was becoming increasingly worried that the continued rallies might spur on “shabiha,” or thugs.

Protests continued into the evening around the capital’s Fourth Circle area, the epicenter of this week’s protests. Wide-scale demonstrations have also been observed across several of Jordan’s major cities.